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Compaq closes its stores Down Under

The PC maker winds down its retail experiment in Australia, closing eight of its nine Compaq Connect stores there.

Winding down its retailing experiment in Australia, Compaq Computer has closed eight out of its nine Compaq Connect stores across the country.

Keith Perkin, manager of the Compaq Connect Group, said the company made the decision to discontinue franchise stores across Australia because of the harsh economic climate.

Of the eight stores, six were shut late last year. Another two closed recently. The remaining store, in Sydney, is no longer a franchise and is run independently of the computer company.

A total of 48 employees were laid off in the closures.

According to Perkin, Compaq was testing the concept of a network of franchise stores across Australia before deciding to return to its core business. "The IT industry is reviewing all programs and pulling back to its basic resources," he said.

The closures follow Compaq's restructuring announced in mid-March, which included 5,000 layoffs worldwide. According to Perkin, only 12 positions were cut in Australia as part of those recent layoffs.

Staff writer Megan McAuliffe reported from Australia.